Gallagher UK CEO Simon Matson yesterday gave evidence in the dispute between Gallagher and Ardonagh and others, in which Gallagher alleges its staff were unlawfully poached.
During the proceedings Matson faced a heavy line of questioning over the senior culture at the broker, by the barrister for Bishopsgate, David Craig QC.
Matson expressed regret over referring to defendant Nawaf Hasan as a “complicated fat Arab” during a 5 July 2017 Whatsapp exchange with Alesco chief operating officer, Gary Lashmar. At the time, Matson was CEO of Alesco.
To Matson’s message, Lashmar responded: “And a very greedy one”
Matson added he would like to “lose all of him [Hasan] but the money.”
Matson and Lashmar were messaging following Hasan handing in his resignation a few days earlier, on 30 June 2017.
Asked whether the message was “derogatory”, “deeply offensive” and “dismissive”, Matson accepted this.
However, when asked whether the message was discriminatory he responded: “I don’t appreciate that. It was not meant in a discriminatory way.”
“I can’t condone the words,” Matson said. “It certainly wasn’t meant in a terrible way. It was a statement of frustration. I felt we were under attack.”
He added that he had spent 10 years building Alesco and continued: “I felt everyone had been disingenuous. It was a stupid thing to say and I regret it.”
Matson denied allegations put forward by the defence that he had told an underwriter he would never allow an Arab to run one of his businesses.
“That’s absolutely nonsense. It’s an unnamed underwriter, conveniently. That is absolute nonsense,” he said.
He also denied understanding a reference to “awaiting 72 virgins”, made by Gallagher international commercial director Vyvienne Wade in an email exchange. Wade was responding to an email in which Matson said they “definitely have places reserved in heaven”, which he confirmed referred to efforts to retain Hasan.
An extract in the Quran refers to Muslims who die performing jihad being rewarded in heaven with 72 virgins.
“To be honest, Vyvienne is a very academic lady and I [sometimes] have no idea what she is talking about,” Matson testified.
“I was embarrassed to ask what she meant,” he added.
According to Matson’s testimony, Hasan and colleague Gerard Maginn had been a “deeply, deeply disruptive” force at Alesco and their presence contributed to a “toxic” culture, referred to in an email sent the same day as the messages to Lashmar. Maginn and Hasan were among a number of staff who left Alesco for Price Forbes and Bishopsgate in 2017.
Matson confirmed Hasan had been offered a retention fee “likely” in the region of £3m to stay, along with a CEO MENA title. He denied prior knowledge that Hasan had wanted a CEO role, as he was not involved in his recruitment process; Hasan joined Alesco after originally being hired to join Gallagher. Matson explained that Gallagher “innocently” breached contract terms with Alesco in hiring Hasan which led the changed role.
Matson was also challenged on repeated use of the word “c*nt” to describe outgoing employees still technically employed by the broker in private messages, disclosed to the court, by himself and other senior Alesco figures.
He described this as “regretful”.
He added that the comments were: “Highly regrettable, certainly not good. They were private conversations borne of frustration and feeling we were under attack. We actually take inclusion and diversity incredibly seriously.”
“I think that is a poor reflection of a great culture, a culture held up throughout the whole of Gallagher,” he added.
Explaining the circumstances behind some of his comments, Matson said: “When the dominoes started to fall sequentially, I felt we were under attack. I felt it was orchestrated for maximum disturbance around the time I was having surgery.”
Ardonagh CEO David Ross, who is not named as a defendant, was aware of the Alesco CEO’s planned six week absence for the procedure at the time, Matson alleged. Ross is expected to give evidence in the coming days.
During the cross examination, it was suggested that Matson and others had sought to bypass then Gallagher UK CEO Grahame Chilton in retention conversations, over fears Chilton’s push option on his Capsicum Re (Cap Re) stake – which when triggered means Gallagher would buy it back – threw up conflict issues and led to tension between Alesco and Cap Re staff.
Prior to Matson taking the stand, Alesco partner Andrew Crichton was cross examined on the broker’s handling of key client accounts that were later lost to Price Forbes.
In the lawsuit, Gallagher alleges that the Ardonagh group, Hasan and former Alesco partner Peter Burton planned a “conspiracy” to poach its staff and business, after seven members of subsidiary Alesco’s energy division left to join the group. The defendants deny this.
The trial will continue today at the Royal Courts of Justice, Queen’s Bench Division, with Matson expected to resume his testimony this afternoon. Today will be the fourth day of proceedings, with the case currently scheduled to run for 12 days in total.
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